The euro is the official currency of the European Union. The euro is symbolised by € and has a currency code of EUR. Introduced in 1999, the euro is the national currency for the countries that make up the eurozone. As well, several European Union (EU) institutions and other European countries have adopted the euro. The euro is used daily by more than 300 million Europeans. With more than €900 billion in circulation, the euro is one of the most traded currencies in the world, second only to the US dollar. The euro is controlled by the European Central Bank (ECB).
Non-Euro EU Countries
Several European countries joined the EU, but continue to use their standard currencies rather than adopting the euro.((http://webs.schule.at/website/European_Currencies/old_eu_currencies_en.htm Retrieved 6 July 2015.))
Euro In Trade
Because of the high volume of buyers and sellers, the euro is one of the most traded currencies. As a forex pair, the euro has precedence in all cross pairs. Pairs include: EUR/NZD, EUR/AUD, EUR/SEK, EUR/CAD, EUR/TRY, EUR/CHF, EUR/USD, EUR/GBP, EUR/JPY, EUR/NOK.
Germany, France, Italy and Spain make up three-quarters of the eurozone's GDP. Many traders follow economic news announcements from these countries because of their large influence on the euro's place in the forex market. The Consumer Price Indices, ECB announcements, GDP reports and others are common indicators on the state of the European economy.
Euro Bills and Coins
Since 2002, euro banknotes have been issued by the ECB and the National Central Banks of the eurozone. Notes are denominated in €5, €10, €20, €50, €100, €200 and €500, and are identical throughout the eurozone, designed with themes of architecture. Notes features complex security features like invisible ink, holograms and microprinting for authenticity. As of 2014, the ECB estimates more than 16 billion euro banknotes in circulation.
The euro is divided into 100 cents, and euro coins are denominated in €0.01, €0.02, €0.05, €0.10, €0.20, €0.50, plus €1 and €2 coins. Euro coins have a common side, featuring a map of Europe. Each country is allowed to design the national side of the coins with some restrictions. As of 2014, the ECB estimates more than 110 billion euro coins in circulation.
Currencies Pegged to the Euro
- Bosnia & Herz. convertible mark
- Bulgarian lev
- Cape Verdean escudo
- Central African CFA franc
- CFP franc
- Comorian franc
- Danish krone (±2.25%)
- Moroccan dirham
- São Tomé and Príncipe dobra
- West African CFA franc
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Russell Shor (MSTA, CFTe, MFTA) is a Senior Market Specialist at FXCM. He joined the firm in October 2017 and has an Honours Degree in Economics from the University of South Africa and holds the coveted Certified Financial Technician and Master of Financial Technical Analysis qualifications from the International Federation…